Available from the beginning to almost all ship types, chain shot is the shot type of choice for attacking enemy sails. Damaging enemy sails hampers their speed and maneuverability; destroying masts completely renders enemy ships immobile. This makes chain shot ideal for capturing enemy ships. On the other hand, chain shot does not harm enemy hulls and rarely kills enemy crew.
Chain Shot is unique in that it functions at the same level of performance anywhere within its effective range (although performance is erratic at best at point-blank range). Instead of distance, it is shot contact with enemy sails that count the most. Enemy ships sailing directly away or towards chain shot with all sails unfurled take maximum sail damage. On the other hand, chain shot fired to the side of ships are much less useful against sails, and is usually ineffectual against furled sails.
Using sails at only half strength, or ordering a ship to halt and furl their sails, minimizes the damage taken from chain shot. Regardless of shot placement or setting of the sail, chain shot can drastically reduce the maneuverability and speed of a ship should a lucky shot topple a mast or two.
While most ships become nearly completely immobilized after losing all of their sails, certain ships (such as galleys or more notably steamships) still retain some measure of mobility even without sails. Regardless of ship type, however, damaging or removing sails definitely reduces the maneuverability and speed of any ship.
Furthermore, any ship without oars or steam power that has all its masts toppled suffers a large morale penalty and becomes practically immobile, so they may be easily flanked and attacked grape shot until it surrenders. This makes it very useful for capturing enemy ships with minimal damage, allowing them to be sold after battle for a higher price, take and repair them more cheaply, or get more cannons for the fleet for salvaging after battle.